The cryptoparadies Singapore was hit by top -class collapse

The international search according to do Kwon, co-founder of the collapsed crypto operator Terraform Labs, Singapore has moved into the spotlight, since the call of the crypto hub after the failure of several crypto funds with connections to the city state suffer a blow.

kwons Terraform Labs, the company behind the collapsed terra stable, was not only registered in Singapore, but Korean prosecutors believe that he traveled to the city in April.

Kwon showed Singapore on Monday as his location on Twitter and tweeted that he was “not trying” to hide. The Singapore police said Kwon was not in the city -state.

kwon's case is not the only top-class crypto controversy that unfolds in Singapore, a city that until recently presented itself as a crypto-friendly travel destination with the global rival Dubai and Zurich.

crypto executives and experts said that the list of scandals and breakdowns that were getting longer ever had clouded Singapore's reputation after officials had advertised his stability, sophisticated regulation and tax-friendliness as an advantage for crypto companies and investors.

"Reputation damage in the past six months has been much more serious than assumed," said Kelvin Low, law professor at the National University of Singapore. "Every time one of these companies is addressed, it is mentioned [as Being] based in Singapore."

In the past, Singapore was a kind of crypto paradise. . . Times changed

Some of the greatest crypto collapse can be followed by Singapore, which has attracted digital asset companies from all over the world.

"Singapore has the most liberal regulatory environment in terms of cryptoinvestment after Switzerland," said Kim Hyoung-Joong, head of the Cryptocurrency Research Center at Korea University.

"Crypto players prefer to operate in Singapore because of the transparent regulations and their simple access to investors for financing," said Kim.

Three Arrows Capital, a crypto hedge fund collapsed in the summer, started as a registered fund administration company in Singapore.

The administration of the company's only fund was later shifted to an offshore unit on the British Virgin Islands. The co -founders Su Zhu and Kyle Davies have not revealed their whereabouts since the collapse of Three Arrows.

The Singapore supervisory authority has complained about Three Arrows for providing incorrect information and the exceeding of determined threshold values ​​for asset management. It also added that there were a check whether further regulatory violations had occurred.

Hodlnaut, a Singaporian crypto loan who generally received a license permit from the Monetary Authority of Singapore, stopped payments at the beginning of this year and released the majority of his employees.

In August, Hodlnaut was placed under preliminary judicial administration. The company said this decision would "offer a better chance of recovery". The Singapore police said they would "examine" Hodlnaut.

According to local media, the Singapore police did not examine Terra's collapse, although a complaint was submitted. The police did not answer a request to comment on the collapse of Terra and Kwon.

mas said "none of these companies that have become difficult is licensed by the Monetary Authority of Singapore" in accordance with its Payment Services Act, which regulates payment systems, and is therefore not subject to its responsibility.

It said that Three Arrows Capital had "stopped manage to manage funds [in Singapore] from the problems that led to his bankruptcy". It also added that Hodlnaut had withdrawn his license application, so that the "suspension of the services did not against" violate Singapore's regulations.

"In Singapore, as in all other jurisdiction, not all activities in connection with cryptocurrencies are regulated," said MAS, adding: "The developing regulatory approach of MAS MAGEPOR Singapore is one of the most comprehensive in dealing with the risks of digital assets".

When the crypto winter started, the supervisory authorities in Singapore started to pursue a harder line, the officials promised to "relentlessly tough" against bad behavior in the industry.

However, experts said that Singapore did not do enough to punish or investigate possible fraud by crypto companies on his banks, since this year there is a crisis by the digital assets industry and caused an avalanche of losses for private investors.

"I think there is a certain extent [Singapore] is ready to say one thing and do something completely different," said a manager of a crypto company working in Singapore.

The same manager said that she believes that Singapore is in a "difficult situation" and attempts to apply a balance between perception as a "serious actor in the world economy" and the "attempt to find out as a hub for innovations in an emerging industry that is clearly evident."

In August, MAS managing director Ravi Menon distanced the regulatory authority from the scandals and said that they would "take further measures to reduce consumer damage".

Most steps were more preventive measures to protect Singaporian small investors, such as: B. a hard passage against advertising, as disciplinary measures.

The changing tone of civil servants like Menon has meant that some crypto companies have re -evaluated their shops in Singapore.

Binance, the world's largest crypto exchange, has given up plans to make the city an important hub, although its CEO Changpeng Zhao lives a large part of the year 2021 there. Last year she was also placed on the MAS investor warning list.

"Singapore is not a big focus for us," said Gleb Kostarev, Regional Head of Asia at Binance. "A lot depends on the regulation.. In the past, Singapore was something like a crypto paradise..

others defended the status of Singapore as a crypto hub and suggested that it would be unfair to blame the city state for the actions of a minority.

"I think it is also a bit unfair to try up the entire burden and responsibility to the regulatory authorities if in many cases the actors of the cryptoma markets are the culprits who, frankly, should know better in many cases," said a familiar person by the matter.

Teresa Goody Guillén, partner of the US law firm Bakerhostetler, said that Interpols Red Notice against Kwon will "probably have no effect on the legitimate interest of companies in the establishment or work in Singapore".

The crypto industry "does not seem to react negatively to law enforcement authorities, the allegations of criminal activities, fraud and the like," she added.

chainup, a blockchain company that offers crypto and other customers technology, said that it is expanding in the city.

The start-up moved its headquarters from China to Singapore in 2019 when Beijing signaled that it would be hard against the crypto sector.

"I am convinced of the procedure of the regulatory authorities," said Sailor Zhong, Chief Executive from Chainup.

"No country can do everything and it is difficult for the government of Singapore to enforce the rule of law for companies with branches abroad."